MAR 1011 FMUJSL Dominos Pizza Turnaround Questions

After five years of stagnant or declining revenues, Domino’s Pizza did something practically unheard of in the business world. It asked customers for honest feedback and reinvented its product “from the crust up.” The Domino’s “Pizza Turnaround” campaign began with marketing research to understand what customers thought and wanted. Industry research showed that although Domino’s was tops in service, convenience, and value for the money, it trailed far behind competitors in taste. To gain deeper insights into what consumers really thought, Domino’s turned to research using social media channels and focus groups. Rather than hiding from these stinging results or waving them off, Domino’s executives fessed up to the problems and faced them head on. The company began by completely reinventing its pizza recipes, and customers seemed to like it. To announce the changes and to turn around customer opinions, Domino’s launched a daring $75 million “Pizza Turnaround” promotion campaign. The startlingly honest campaign was fully integrated into the brand’s Facebook and Twitter pages, where the company posted all the bad along with the good and asked for continuing feedback. Since the Pizza Turnaround campaign began, Domino’s has seen revenues increase by 21 percent and profits increase by 31 percent, even as the pizza-delivery industry and restaurants in general of struggled. The lesson for marketers is that talking to customers, hearing what they have to say, and acting on the resulting insights can pay big dividends.

View the Domino’s Pizza Turnaround documentary at www.pizzaturnaround.com. You can also explore the pizza turnaround from different perspectives by going to www.youtube.com and entering the keywords “pizza turnaround.”

Answer the following questions:

1. How is it possible that a large and successful corporation such as Domino’s drifted so far from what its customers thought about them and how their pizzas tasted? (Consider how companies can weaken their market position and lose their competitive edge when they fail to conduct continual market research, revisiting customer preferences, checking out the competition, and double-checking their assumptions. It is also possible that Domino’s had not yet developed a well-rounded strategy for monitoring social media channels, a key research avenue.) 
2. How Domino’s gain key customer insights into the underlying needs, emotions, and brand connections of its pizza customers? How did it apply these customer insights in The Pizza Turnaround campaign?